SMBs and midmarket enterprises aren't fully using the available online e-commerce and marketing potential of the Internet, and are losing profit because of it. These are some of the key insights and best practices uncovered by Yankee Group's DecisionNote, Evolving SMB and Mid-Market Enterprise Web-Hosting Market Dynamics study. Although the Internet is the fastest-growing sales channels for both SMBs and midmarket businesses, Yankee Group found that there is still a great deal of apprehension that exists for creating Web storefronts. Only 32 percent of the 710 U.S.-based SMB and midmarket companies surveyed indicated they are using email marketing and search engine optimization on the Internet. Only 19 and 17 percent currently pay placement search engines and keyword searches on the Internet, respectively. In addition, only 23 percent are using Internet shopping carts and merchant accounts, according to the survey.
Considering the varying number of online marketing channels that are available to SMBs and midmarket enterprises, these findings baffle Sanjeev Aggarwal, SMB strategies senior analyst at Yankee Group. "The slow adoption rate of e-commerce, online marketing tools, and hosting services is leading a key revenue channel underutilized by SMBs, even though companies such as Interland and Affinity Internet offer specialized services that can dramatically assist companies with their online marketing strategies," he says.
Aggarwal cites a possible reason for this: Smaller companies are less skillful at adopting online marketing tools than enterprises--this itself can be attributed to online marketing having become more specialized, which makes it more difficult for SMBs without dedicated marketing departments to keep up with marketing trends and developments. He asserts, however, that there are positive signs of change. "SMBs are increasing the use of sponsored search through the use of adwords and keywords. These online marketing techniques are gaining popularity even when compared to online/offline yellow pages." In addition, Aggarwal cites Yahoo and Google as "booming businesses that are helping companies use the Internet to reach large audiences. Now they lead the online effort to go after the ad business of SMBs."

There are also numerous software vendors like WebSideStory, Urchin, and WebTrends; and service companies like Interland and Affinity, that can offer SMBs affordable technology and services to maximize their online e-commerce presence, Aggarwal says. "Companies like WebSideStory and Urchin offer the analytical technology to tell companies who's going where and what people are clicking on. That's all analytic information a company can use to maximize their Web sites. There are also several hosting companies, such as Interland and Affinity Internet, that now offer outsourced marketing services to help smaller companies focus on this area and gain insight from the analytic data they gather from software providers."
Focusing on these crucial areas can lead to big payoffs, Aggarwal says. "More top search-engine rankings (both organic and sponsored) and traffic provide more sales and a better bottom line; a higher ROI on the Internet marketing investment will continue to pay off in new customer acquisitions."
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